
Sometime back, Twitter was agog with a short but relatable tweet of a young lady; a tweet with content synonymous with what is known as the black tax in the southern parts of Africa. The black tax is a tradition so common that it earned a prominent spot in Trevor Noah’s “Born a Crime”, a really beautiful book by the way.
Saving money is the biggest challenge with us Africans. You save a little, next thing U hear is “grandma swallow razor send something”
— hispania__ (@Ojimah4) January 12, 2019
To properly explain the black tax, we can lend the words of Gerald Mwandimbira of the Savings Institute, South Africa. In this article, he said, “Black tax sees the person’s salary portioned off to support older parents or an extended family while trying to raise a young family. This puts one’s responsibilities in a ‘sandwich and hence this is often called the sandwich generation. The sandwich generation supports the generation above them, as well as the generation below. Making it difficult for the sandwich generation to save money, which will, in turn, pass this tax down to future generations.”
The consistent trend of difficulty with savings due to this “tax” can lead to a vicious cycle of generational dependence if not managed.
Probably the root of this culture can be traced back to a common African saying — “It takes a village to raise a child”. Although there is a positive side to this saying, it also implies that enjoying success alone as an African is almost impossible.
This isn’t to say that there is anything noble in enjoying the benefits of your success on your own, especially without those that helped raise you, but when does sharing become harmful? When you find yourself not being able to take care of your necessities because you are too busy helping others, a line needs to be drawn. You need a balance to be able to sustain the help you lend out to others.
Does this suggest money transfers from Africans to family members as the major reason for poor savings among Africans? Definitely not, but sharing what is probably not managed properly can only make things worse for the one who is being the good Samaritan. So the big questions are:
A. How can you do better with your personal finances?
B. How can you effectively juggle your needs and the needs of those who supported your development?
Effectively answering the first question makes the second one a lot easier. To help with the first we have a few suggestions:
1. Although the black tax is almost unavoidable, you have a right to keep the total value of your income to yourself. If this can happen without any violent face-offs with family members, please make your income your personal business.
2. With your income well guarded, commit to budgeting your income properly and building an emergency fund. An emergency fund should contain 3 to 6 months of your living expenses. Learn how to build one.
These two steps are critical to achieving success with the next steps. On juggling your needs with those of others you love, you should consider the following suggestions:
1. In your budget, set a cap for the black tax and stick to it. How do you stick to it? Pay yourself first and place your savings and investments in locked accounts. Cowrywise can help with this, our locked plans are 100% efficient.

2. Set a necessity test, one that will guide what you spend the black tax on. Items should border around survival needs — feeding, housing, schooling and health.
3. Learn to say “no”. This is probably one of the most potent tools for preventing unplanned spending. If it isn’t a case that is a life-threatening one and doesn’t pass your budget or necessity test, kindly turn down the request. Saying no is a lot easier when you have the first suggestion sorted.
A choice to manage the black tax will not only help you do better with your savings and build wealth, but it will also prevent you from becoming dependent on your children when you get older also. Do them a favour by making the right choices today.
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I really want to control my finances. I envisage that I have a great tendency of making money and mismanaging funds. Most times I run out of money before the month ends and I feel terrible about it.
Hi Sonia.
Thanks for your vulnerability.
We provide a lot of financial education guides on our blog that can help you better control your finances.
Take it step by step and you’ll do better in now time!
What about school fees, health , charity and insurance.
school fees, insurance, and health can be placed in that friend’s wedding column as talked about in the article, t its all about understanding the main idea, looking within yourself where does this item fall, it’s about been creative and manageable with your money, i.e how long money stays in our hand using it effectively.
thanks a lot,Ope.really helpful,sometimes we outline the fixed and forget the discretionary ,and wonder how alll the money disappeared .This is very insightful
I look forward to more articles from you guys, random articles on various life topics. I love the active voice you used in writing and that sacarsm part too?
Thank you! We look forward to having you back here too ?
This is really amazing and educating! Keep it up and thank you so much for THIS ARTICLE ?
Our pleasure ?
Hello Ope,
This piece is quite insightful and helpful. Thank you. I Read the part where you advised to not document budget on a book as one can lose the book. Can you recommend an app on playstore one can use?
Yes. I’m seconding this comment. I believe an accounting application can help. I actually document my expenses daily but combining them into a general heading is a big task.
Please help us, Ope.
Hi Glow, I can’t recommend any tool off the top of my head right now, but creating a simple Google sheet or excel file for your budgeting can work.
I have a challenge, am the one catering for the house so most times I run into debts because expenses are higher than income . please how do I work on this.
thanks
Okay, Ope, you got me on with this one! ?
I know I make a lot of money as a full-stack digital marketer, but after some time, I’m broke and I’m wondering how come? As you said, I’m wondering “where did all the money go to?”
Sha, this post is very helpful and I’ve just downloaded this app I want to make use of in listing out the entire process… but quick ??
Which app or tool would you recommend for proper budgeting and evaluation?
Regards,
Sam
Hey Sam, happy to hear you found this helpful! ?
For the tool to help with budgeting, I highly recommend that you get down to do the “dirty work” first by yourself. Create a sheet on Google Sheets or Excel to input and track your spending to give you a raw idea, and then you can use other tools for lighter budgeting work based on the idea you now have from your sheet.
Hi Glow
You can download money manager on playstore, that’s what I use. There are others there too
I spend close to 38,000 only
Hi Sam,
I found it fascinating when I had to keep track of my sister’s account, but tracking my own expenses or developing a personal budget appears to be an impossible feat.
I mean… I don’t have a stable source of income yet so it seems almost hard to do but then after going through your write up I wrote a few ways in which I get money and am hoping I’d be able to get an hang of it soon.
Thanks for the detailed explanation.
Ope rather not Sam, sorry.
Wow! This is great, learnt a lot
Thank you so much for sharing this, Ope.
I have a question though. How can I budget as a student?
Because it seems like I can’t apply the whole concept of budgeting in my life at the moment.
I mean, I am a student, I don’t have a fixed source of income; I receive allowance from my parent and sometimes from relatives. I also do not work and I have no investments.
Sometimes, I feel like financial plans and budgeting is just not for me, even though I’m quite interested in them.
Like when I even receive my allowance, the rate at which the money finishes fast, makes me ask myself, “How?” “Where did all the money go to?” and “What did I spend the money on?”
I want to know how to track my expenses, save effectively and if possible invest and then build a financial plan, even as a student but I don’t know how to go about it neither do I know what to do.
So, if there’s any advice you could give me, please do. I’m very ready to learn.
Also, thank you so much for your financial lessons. I am always happy when I see your blog updates in my email. Thank you!?
This is very insightful and educative. I will make a do with this tips immediately. Thanks immensely Ope.
This is helpful I learnt a lot as a young graduate budget helps in build Future occurrences coming in the future also helps to pridict a lot of plan that u ought to achieve
Thanks Ope for this rich enlightenment.
But I got to ask you a question.
What if you don’t get an income per say but, a kind of allowance that’s not stable that you’ll have to ask before its been given to you. How then do you plan a budget given such instance?
Thanks for this wonderful post of yours.It is more encouraging.
Dear Ope,
Thanks for this insightful write up. I am definitely practicing this starting now. This is just what I needed to hear at this time. Thanks again
Really amazing thanks alot for this
I need withdraw
Thank for this wonderful post of yours. It is more encourage
I need withdraw
This article came in on time. Am guilty of many of the bad money management stated in the article. Not withstanding, it is not too late to start. I will be better equipped for the remaining part of the year and next year as well. Thanks Ope
Alisabiu744@gmail.com
This article came in on time. Am guilty of many of the bad money management stated in the article. Not withstanding, it is not too late to start. I will be better equipped for the remaining part of the year and next year as well. Thanks Ope
Ope thanks for this powerful awareness, pls if the is an app I can use for something like this let me know. I should start taking records this month
Mohammed
How can I do this
Thanks very much Ope. I always enjoy your post they are enlightening.Talking about budgeting how can one who’s money doesn’t come in bulk monthly go about making and achieving his or her budget.
I can control my financial status on my own. Because I really feel to be financially independent, on the basis of personal interest, and growth. Thank you so much.
Hi Ope,
Thanks for the blog,
I am currently working and I don’t earn enough. Also, I have to settle bills at home and help the family.
I find it hard to save, any advice on this?
Thanks for this piece, I really needed it to start my next month.✨
Thank you so much Ope. We shall do this
Cowrywise has really helped me to everyone more and spend less
I wish it will not crash
Thanks so much. This is an eye opener. I always wondered why I’m left with nothing at the end of the week/month/year after making so much money. Please, do cowrywise have a budgeting app that could be helpful.? It’s important